Munich Re reports that insured losses from tropical cyclones in 2024 were considerably above average.

According to global reinsurance giant Munich Re, both economic and insured losses from tropical cyclones worldwide in 2024 were significantly higher than average. The total economic losses amounted to approximately $133 billion, driven by tropical cyclones in the North Atlantic (hurricanes) and Northwest Pacific (typhoons), compared to the 10-year average of $89.2 billion and the 30-year average of $62.6 billion.

For the insurance and reinsurance market, insured losses were estimated at $51 billion, well above the 10-year average of $35.1 billion and the 30-year average of $23.7 billion. Munich Re noted that these losses, particularly from severe North Atlantic hurricanes, made 2024 the second costliest year for tropical cyclone-related losses, following 2017.

The severe North Atlantic hurricane season was the main driver, with $110 billion in economic losses in North America and insured losses estimated at around $49 billion. Despite a relatively average number of storms, the storms intensified rapidly, often producing extreme rainfall, which is increasingly linked to climate change. Munich Re emphasized the importance of strengthening prevention and resilience measures to mitigate future losses, as climate change is fueling higher sea surface temperatures and storm intensities.

In the Northwest Pacific, typhoons caused economic losses of around $22 billion, with an insurance market share of just $2 billion, highlighting a significant protection gap. Typhoon Yagi, affecting Asia, was the third-costliest cyclone of the season globally, with $14 billion in economic losses but only $1 billion in insured losses. Munich Re stressed that climate change is not only influencing storm frequency but also their intensity and rainfall potential, underscoring the urgent need for improved resilience measures.